diff --git a/mongodb-community-operator/pkg/kube/podtemplatespec/podspec_template.go b/mongodb-community-operator/pkg/kube/podtemplatespec/podspec_template.go
index 1b17f69b0..50f96fa22 100644
--- a/mongodb-community-operator/pkg/kube/podtemplatespec/podspec_template.go
+++ b/mongodb-community-operator/pkg/kube/podtemplatespec/podspec_template.go
@@ -93,16 +93,20 @@ func WithInitContainer(name string, containerfunc func(*corev1.Container)) Modif
 	}
 }
 
-// WithInitContainerByIndex applies the modifications to the container with the provided index
-// if the index is out of range, a new container is added to accept these changes.
-func WithInitContainerByIndex(index int, funcs ...func(container *corev1.Container)) func(podTemplateSpec *corev1.PodTemplateSpec) {
+// WithPodLabels merges the provided labels with existing PodTemplateSpec labels.
+// This preserves labels added by external systems (like Kyverno policies) while
+// allowing the operator to add or override its own labels.
+func WithPodLabels(labels map[string]string) Modification {
+	if labels == nil {
+		labels = map[string]string{}
+	}
 	return func(podTemplateSpec *corev1.PodTemplateSpec) {
-		if index >= len(podTemplateSpec.Spec.InitContainers) {
-			podTemplateSpec.Spec.InitContainers = append(podTemplateSpec.Spec.InitContainers, corev1.Container{})
+		if podTemplateSpec.ObjectMeta.Labels == nil {
+			podTemplateSpec.ObjectMeta.Labels = map[string]string{}
 		}
-		c := &podTemplateSpec.Spec.InitContainers[index]
-		for _, f := range funcs {
-			f(c)
+
+		for k, v := range labels {
+			podTemplateSpec.ObjectMeta.Labels[k] = v
 		}
 	}
 }
diff --git a/mongodb-community-operator/pkg/kube/podtemplatespec/podspec_template_test.go b/mongodb-community-operator/pkg/kube/podtemplatespec/podspec_template_test.go
index 680633d58..b387de976 100644
--- a/mongodb-community-operator/pkg/kube/podtemplatespec/podspec_template_test.go
+++ b/mongodb-community-operator/pkg/kube/podtemplatespec/podspec_template_test.go
@@ -616,3 +616,63 @@ func getCustomContainer() corev1.Container {
 		Image: "image-1",
 	}
 }
+
+func TestWithPodLabels_MergeWithExistingLabels(t *testing.T) {
+	existingPodTemplate := &corev1.PodTemplateSpec{
+		ObjectMeta: metav1.ObjectMeta{
+			Labels: map[string]string{
+				"foo.bar/customer": "acme-corp",
+				"foo.bar/env":      "prod",
+				"external-label":   "preserve-me",
+			},
+		},
+	}
+
+	operatorLabels := map[string]string{
+		"app":     "database",
+		"version": "6.0",
+	}
+
+	modification := WithPodLabels(operatorLabels)
+	modification(existingPodTemplate)
+
+	expectedLabels := map[string]string{
+		"foo.bar/customer": "acme-corp",   // Preserved from existing
+		"foo.bar/env":      "prod",        // Preserved from existing
+		"external-label":   "preserve-me", // Preserved from existing
+		"app":              "database",    // Added by operator
+		"version":          "6.0",         // Added by operator
+	}
+
+	assert.Equal(t, expectedLabels, existingPodTemplate.ObjectMeta.Labels)
+}
+
+func TestWithPodLabels_OverrideExistingLabels(t *testing.T) {
+	existingPodTemplate := &corev1.PodTemplateSpec{
+		ObjectMeta: metav1.ObjectMeta{
+			Labels: map[string]string{
+				"app":            "old-app",
+				"version":        "5.0",
+				"external-label": "should-be-preserved",
+			},
+		},
+	}
+
+	operatorLabels := map[string]string{
+		"app":     "database", // Should override existing
+		"version": "6.0",      // Should override existing
+		"tier":    "backend",  // Should be added
+	}
+
+	modification := WithPodLabels(operatorLabels)
+	modification(existingPodTemplate)
+
+	expectedLabels := map[string]string{
+		"external-label": "should-be-preserved", // Preserved
+		"app":            "database",            // Overridden by operator
+		"version":        "6.0",                 // Overridden by operator
+		"tier":           "backend",             // Added by operator
+	}
+
+	assert.Equal(t, expectedLabels, existingPodTemplate.ObjectMeta.Labels)
+}